MITI and the Japanese miracle

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the years since his retirement Nagayama has become a respected "senior" in the oil-refining business, but the age of "Emperor Nagayama" is still remembered within ministry circles as one of the three most divisive periods in the ministry's history (the other two were Kishi's appointment as minister in 1941 and Sahashi's rejection as vice-minister in 1963).

In addition to these personnel and factional problems, the early years of the ministry saw the first steps taken toward the formulation of the high-growth policy. The International Trade Bureau was the busiest place in MITI, but it spent most of its time processing import and export applications and consulting with SCAP instead of thinking about where the Japanese economy should be going. Within a few years it had been completely outclassed by the Enterprises Bureau as the center of planning and policy-making. During 1949 the Enterprises Bureau worked quietlyits name is scarcely mentioned in the SCAP archivesbut with great effectiveness. On September 13, 1949, the cabinet adopted the Enterprises Bureau's "Policy Concerning Industrial Rationalization" (Sangyo * Gorika* ni kan suru Ken), which must be regarded as one of the most crucial, if least acknowledged, milestones of the Dodge Line and of postwar Japanese industrial policy.

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This document contains the seeds of the Japan Development Bank, the Foreign Capital Law of 1950, the attacks on the Antimonopoly Law, the reform of the tax system to favor industrial growth, and the creation in December 1949 of the Industrial Rationalization Council (Sangyo Gorika Shingikai). One of the most concrete results of the cabinet's policy decision was the passage two years later of the Enterprises Rationalization Promotion Law (Kigyo* Gorika Sokushin Ho*, number 5 of March 14, 1952), the first of at least 58 separate industrial policy statutes enacted between 1952 and 1965 under MITI's sponsorship.

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During the 1950's the work of the Enterprises Bureau and its Rationalization Council became as important for the country's economy as Yoshino's Temporary Industrial Rationality Bureau and Commerce and Industry Deliberation Council had been twenty years earlier. The paternity of the 1949 ideas also clearly goes back to the MCI initiatives formulated at the beginning of the great depression.

The leaders of the Enterprises Bureau during the waning years of the occupation were its bureau chief, Ishihara Takeo; its deputy chiefs, Tanaka Shin'ichi (who was in charge of the materials mobilization plans in the old Cabinet Planning Board) and Iwatake Teruhiko (who after retirement was on the board of Kobe Steel); and its section chiefs, Imai Hiroshi (who was subsequently on the board of the JDB)